Chubu Electric Complies with Prime Minister's Nuclear Shutdown Order

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Researched by Industrial Info Resources East Asia (Kofu-shi, Japan)--In late March, Chubu Electric Power Company Incorporated (TYO:9502) (Chuden) (Nagoya, Japan) announced that it intended to restart Unit 3 of Hamaoka nuclear power station located in Omaezaki, Shizuoka prefecture, despite trouble at Fukushima Daiichi. At the time, Chuden was in the final stages of inspection and had planned to begin the restart by the end of April.

Restart plans were delayed to June, and on May 6, Prime Minister Naoto Kan ordered the suspension of Hamaoka, calling it one of the 'most dangerous' nuclear power stations in the world. Hamaoka is located on the coast of Shizuoka prefecture at the edge of Suruga Bay. This region is home to the centennial Tokai earthquake, of which the next is predicted at magnitude 8.0. The Japan Meteorological Agency has taken eight previous earthquakes in account and has been charged with predicting the next one. These were recorded between the years of 684 and 1854, and were each estimated to have been magnitude 7.9 or higher.

Hamaoka power station was unaffected by the Great East Japan Earthquake on March 11, and its operational units, 4 and 5, were not forced to shutdown. Unit 5 was restarted on February 23 following a lengthy unplanned outage due to the 6.5 Suruga Bay Earthquake that occurred in August 2009. On March 15 at approximately 10:30 PM JST, a 6.0 earthquake occurred near Mount Fuji, which is located approximately 90 kilometers from Hamaoka. However, the power station remained safe and incurred no damage.

Even though Hamaoka fared well through the Great East Japan Earthquake and the March 15 Mount Fuji earthquake, Chuden's board of directors convened twice after the prime minister's order to decide whether or not operations at Hamaoka should be suspended. Suspensions would not only mean the loss of about 3.5 gigawatts, but the indefinite delay of expansion plans.

Chuden decided to comply with the prime minister's request on Monday, May 9. The company plans to first secure additional electricity by restarting mothballed thermal power stations and finalize plans for additional liquefied natural gas before suspending Hamaoka in order to avoid power shortages in the summer. Industrial customers such as Toyota Motor Corporation (NYSE:TM) (Toyota, Japan) account for approximately half of Chuden's sales, and Toyota as well as other large manufacturing companies cannot afford to be hindered by rolling blackouts. Suspension will last until Chuden has ramped up tsunami safety precautions; the company plans to build a 1.5-kilometer long, 12-meter-high seawall to protect the power station.

The earthquake safety of Chuden's only nuclear power station has been called into question before. In December of 2008, Chuden's board of directors decided to terminate operations of the boiling water reactors of units 1 and 2. Due to the amount of seismic activity and the impending Tokai Earthquake, the board of directors originally wanted to renovate and increase earthquake resistance all five of Hamaoka's units. However, due to their age, Chuden determined that it would be economically unfeasible to renovate units 1 and 2, which would have cost an estimated $3 billion and take 10 years. Chuden decided to scrap the units and build a new, 1,400-megawatt (MW) unit to replace them. The $3.5 billion Unit 6 is being planned to incorporate an advanced boiling water reactor and is currently scheduled to undergo construction beginning in April 2015. Once completed, Unit 6 is estimated to be able to withstand a magnitude 8.5 earthquake.

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